The Securities and Exchange Commission (SEC) is reportedly moving a step closer to facilitate the tokenization of securities using blockchain, the Bangkok Postreported, quoting an interview with the deputy secretary general Tipsuda Thavamara.

The Thai regulator has been pushing for stakeholders to accept the amended Securities and Exchange Act of 2019 which went into effect on April 17.

One significant change is the expansion of the coverage scope for digitized securities to cover the primary market for all types of securities.

Importantly, the new law also facilitates the digital fundraising instrument called securities token offerings (STOs).

Previously, the Act stipulated that the traditional securities in the primary market must be issued with paper-based scrips. Scripless transactions were previously only allowed in the secondary market.

Ms Thavamara told the paper: “This change will have a major impact as the amended Act provides a legal basis to support the country’s capital market with the tokenization platform.”

In other words, the amendment makes it possible for companies to issue tokenized securities depository platform and issuance of digital shares in the primary market.

Since last year, Thai startups have been raising funds through tokenization under the digital asset royal decree (The Thailand Royal Decree on Digital Asset Businesses B.E. 2561) which covers all aspects of the virtual trade. Royal decree includes digital exchanges, brokerage firms, dealers and ICO portal services.

However, the royal decree, while it provides some regulatory clarity for the digital assets as a whole, some aspects of it was found to overlap with the Securities and Exchange Act, Ms. Tipsuda told the paper.

Now with the amended Act in force, there should be even greater clarity. In other words, all securities tokens should now be governed under the Securities and Exchange Act, while those digital assets that do not exhibit characteristics of securities (such as utility tokens) should still come under the royal digital asset decree, even if it is issued digitally.

Meanwhile, about a third of Thai executives say that blockchain will be the most important new technology for their business over the next three years, according to a survey by Accenture, published by the same paper.